Shares in NZX plunged 11 per cent after the stock exchange operator flagged a drop in first-half earnings amid tepid trading values and rising costs from its Clear Grain Exchange litigation and to cover the costs of installing a new chief executive.

The stock sank to a three-month low $1.17 after reporting its earnings before interest, tax, depreciation, amortisation, and fair value movements were between $9 million and $10 million in the six months ended June 30. That's smaller than the ebitdaf of $11.7 million in the same period last year. Net profit was between $3 million and $4 million, compared to $4.5 million in 2011.

"We were expecting a little better from the NZX, and this caught the market by surprise," said Grant Williamson, a director at Hamilton Hindin Greene in Christchurch. "The stock's been one of the best performers in 2011 and 2012 to date"

The stock exchange operator's expenses were between $2 million and $3 million higher than last year, with about two-thirds arising from the CEO transition, the Clear litigation and other non-recurring items, NZX said.

NZX's outlook for the next six months "combines a traditionally stronger second-half for NZX's businesses with some significant market developments against the backdrop of a challenging global economic environment," the company said. "The medium-term outlook for the business remains strong."

The stock exchange has had to contend with dwindling trading values on its bourse this year as investors remain nervous with Europe's sovereign debt woes eroding confidence.

It returned about $34.4 million to shareholders in May after the getting the proceeds from its TZ1 carbon trading registry sale.

NZX said it will launch equity derivatives in the first-half of next year, and plans to embark on a series of initiatives to bolster its global position with dairy derivatives.

"Resources will also be invested in initiatives designed to increase the attractiveness of listing for small and medium-size companies seeking capital for growth," it said.

The company will give a more detailed outlook when it officially publishes its first-half results on Aug. 20.

The stock is rated an average 'hold' based on three analysts' recommendations compiled by Reuters, with a median target price of $2.84.